09
April
2020
|
14:53
Europe/London

LOTUS Coronavirus update (09.04)

 

THE REFUND ISSUE 

Travel industry bodies spear-headed by ABTA, but which also includes the WTTC, LATA and ETOA, have been lobbying the UK government to relax the Package Travel Regulations with regards to refunds.

This week ABTA called on members to back a campaign to put more pressure on the Government to protect the travel industry by asking them to visit its new campaign website, savefuturetravel.co.uk, and send an electronic letter to their local MPs appealing for action.

ABTA claims Government intervention is needed to prevent travel companies collapsing, which will cost the taxpayer £4.5 billion in refunds that the Air Travel Trust Fund can't cover, and hundreds of thousands of jobs.

TTG reports that 13,500 emails were sent to 647 ministers out of a total of 650, and the emails included 4,000 from supporters, which ABTA said demonstrated the "breadth and depth of concern" and the level of frustration within travel at the lack of government action so far.

Former foreign secretary Jeremy Hunt has said the government is hoping to reach a decision on the policy of refunding travel plans “as quickly as possible”.

Hunt, MP for South West Surrey and foreign secretary from 2018-19, wrote to Haslemere Travel owner Gemma Antrobus, who had contacted him as part of the Save Future Travel campaign.

But he warned that the “complexity of the sector” meant “a one-size-fits-all approach doesn’t seem to be appropriate”.

The Latin American Travel Association (LATA) initiated their own government petition today to temporarily suspend aspects of the Package Travel Regulations to help companies in the travel industry survive the current COVID-19 crisis.

NEWS

Lockdown restrictions

Despite mounting pressure, the BBC reports that it is likely the Government will put the health crisis before the economic crisis and will not lift the lockdown from 16 April, when a formal review is due.

Wales has already announced a continuation of lockdown measures. The Telegraph reports that while Boris Johnson remains in intensive care, ministers are reluctant to make definitive decisions on when and how to lift the lockdown.

This comes as restrictions continue to cause a collapse in commercial activity, fuelling concerns for the longer-term physical, mental and economic health of the country. It also follows the announcement from Foreign Office last weekend to extend its ban on non-essential travel for an indefinite period of time.

The Times reports that yesterday, the World Trade Organisation said that “ugly” declines would bring “painful consequences” for companies and people across the world with global trade set for its worst year in decades. It has exceeded the slump that was recorded during the financial crisis with volumes set to tumble by a third.

The Economist says that the situation is far more severe than in previous recessions. Numerous indicators suggest extreme stress. Global oil demand has dropped by up to a third; the volume of new cars and parts shipped on America’s railways has dropped by 70%. Many firms have only enough inventories and cash to survive for three to six months – and papers at the weekend suggested that most small companies will only survive eight weeks. The Economist continues that the exit path for those that survive will be precarious, with uneasy consumers, an efficiency-sapping stop-start rhythm, and tricky new health protocols. In the long run companies will have to master a new environment. The crisis and the response to it are accelerating three trends: an energising adoption of new technologies, an inevitable retreat from freewheeling global supply chains and a worrying rise in wellconnected oligopolies (a state of limited competition).

Schools the first to open?

The Financial Times reports today that ministers are discussing whether young people could be the first to be allowed out of the lockdown, with a debate taking place about whether schools might be able to reopen later this month.

Hoteliers to open 3 May?

A report in the FT said that whilst few are unwilling to predict, analysts at Bernstein found across a sample of hotels in five countries suggested that there was an average plan to reopen on 3 May 2020 (although they admitted this was a hopeful estimate).

The feature found that tour operators have been forced to freeze payments, suspend contracts and in Tui’s case, seek emergency loans amid government lockdowns. The FT compared how many hotels have stayed open in different markets.

Milan, the Italian city at the centre of the European outbreak, had just one in 10 hotels open for business in the week of March 23, two weeks after the start of a national lockdown but that had dropped to near zero last week.

In London the number of open hotels plummeted from 75 per cent to zero in a week, after the prime minister imposed strict travel restrictions.

In New York, the supply of open hotels has dropped roughly 25 percentage points in the past week as the number of cases has jumped. Yet New Yorkers appear optimistic, with openings set to return to normal levels over the next 60 days.

EU unity under threat In an interview with the BBC, Prime Minister of Italy, Giuseppe Conte says that the EU must act in a coordinated way and share debt or risk the EU project. Sky News says that deadlock remains between European leaders about how to save households and companies across the continent from going bankrupt.

UK Travel The Guardian reported this week that Government figures show rail journeys in the UK are now at just 5% of normal levels. Bus passenger numbers outside London are down 88% from the same time in 2019, with just under half of normal services running, while air traffic is down 92% compared with last year – with the few remaining flights mostly for either repatriation or cargo. Overall road traffic was also down 71% for last year, falling by 83% on the strategic road network (motorways and trunk roads). In London, tube journeys were down by 94%, while there were 80% fewer bus journeys than this last year, the minister said. The number of Cross-Channel Eurostar journeys was now just 1% of those taken daily in 2019.

Italy

Infection and death rates are reducing in Italy and Prime Minister Conte hopes to ease restrictions slowly at the end of April. Italy’s testing rates are about double that of the UK.

France

Many media report that France's central bank said it had entered recession with an estimated 6% contraction in GDP in the first quarter of the year, after the economy shrank by 0.1% in the fourth quarter of 2019 - and two quarters in a row of decline meets the definition of a recession.

Germany

Sky News says that Germany, Europe's biggest economy, is predicted to shrink by 4.2% this year, according to a report by the country's leading forecasters.

Spain

UniCredit research published this week, reports the FT, suggests that Spain is set to suffer more from the crisis than any other European economy, estimating a 15.5 per cent decline in gross domestic product this year and a fiscal deficit of 12.5 per cent of GDP.

Such figures are a big reason why, despite resistance from northern Europe, Madrid is pushing for mutualisation of debt and EU-backed “coronabonds” — an agenda on which Eurozone finance ministers signally failed to agree in an all-night meeting that ended on Wednesday morning.

China

Routes Digest has reported that the airport serving Wuhan – where the pandemic began - has started scheduled domestic flights again with Wuhan Tianhe Airport reopening after a 76-day closure as the city lifted its travel ban. This has ended the world’s largest mass quarantine. However, the FT reports that the population is fearful of a second outbreak and reports that the move is just the start of a long recovery for a city in severe economic distress.

Routes Digest also reported that commercial aviation in China crept toward normalcy in March, reaching 42% of its capacity before the coronavirus outbreak hit the country in December.

According to the Civil Aviation Administration of China (CAAC), average daily flights during March reached 6,533, up 20% on the previous month. These flights were primarily in the Yangtze River Delta area, the heavily industrialized area that encompasses Shanghai, mainland China’s financial centre.

For the coming week, 108 international flights are planned to China. These will be flown by 20 foreign airlines from 12 countries. In China, 18 domestic airlines will fly 88 international routes.

To contain imported cases of COVID-19, China is allowing each foreign airline to maintain only one route to China and operate only one flight per week on it. These flights are not permitted to have load factors beyond 75%, so social distancing can be maintained within the aircraft.

China in bid for global leadership

Today the BBC and Daily Mail discuss how China, whose economy is generally recovering quickly, is using its position as the first country to emerge after the pandemic to make a bid for global leadership through supplying medicine, medical equipment, teams and experience. This comes even though they were the source of the virus and delayed reporting the spread. With the US President seeking an isolationist path and not interested in leading any kind of global effort, there is a power vacuum, ready to be filled, say commentators.

USA

Partner agency to LOTUS, Mardiks Public Relations has reported that in the USA, virtually all travel is at a standstill with transatlantic air travel down 85%. It is likely that there will be further travel industry consolidation this year and restoring trust will be vital to any kind of recovery with health and safety top of mind. There are predictions that business travel will return before leisure and intrepid travellers will return first along with millennials, whilst senior travellers with the greatest health concerns will be the last to travel again. Good deals will be vital to incentivise other travellers. From a US point of view, travellers are likely to seek out less-dense cities and off-the-beaten-path destinations with local and regional domestic tourism recovering first.

The US cruise industry will likely return with a home-port focus and shorter itineraries - and shoulder and off-season travel will increase to avoid crowds.

Brexit Negotiations

The BBC reports that there has been only one meeting between the UK and EU Brexit negotiators since 31 January and the EU believes the transition period should be extended as the shock of a new system and added bureaucracy at the end of the year after the pandemic is not in the interest of UK and EU businesses, but the EU says the request has to come from London.

Airports to create health and safety guidelines

The Financial Times reports that European airports are drawing up industry-wide guidelines on issues such as passenger health screening to ensure a co-ordinated response when travel restrictions imposed during the coronavirus pandemic are eased. The action comes after London’s Heathrow, one of the world’s busiest airports, faced criticism from passengers for the absence of temperature checks as the UK enters its third week of lockdown in an attempt to contain the disease. The airport has called for a global standard in passenger health screening for coronavirus as the industry currently takes different approaches based on guidance from their national public health authorities. In the UK Public Health England didn’t advise temperature checks, however, many other countries do. This comes as Business Traveller says that it is trialling new airport technology designed to help identify medically atrisk passengers, potentially including those in early stages of Covid-19 and that Delta is introducing a raft of social distancing measures both inflight and on the ground.

EasyJet funding

Business Traveller reports that EasyJet had secured a £600 million loan from the Covid Corporate Financing Facility issued by HM Treasury and the Bank of England.

Norwegian

TTG reported that Norwegian will look to restructure its debt in an attempt to raise the equity it needs to qualify for £236 million in state aid.

Saga Buoyed by ‘resilient cruise bookings

TTG reports that Saga has reported that bookings for cruise have been resilient in the current situation, with forward bookings for September to January 2021 so far achieving 66% of target revenue, and 2021/22 some 16%.

Saga says its cruise bookings for the full-year to 31 January held firm, but warned there would likely be more pain to come for its tour operator business owing to the coronavirus pandemic. Saga has though temporarily stopped marketing its 2021/22 season to new customers due to the coronavirus pandemic.

It hailed in its annual report, issued on Thursday, the first six months of Spirit of Discovery’s inaugural, year. "The new ship also met financial expectations with Ebitda [earnings before interest, tax, depreciation and amortization] in the second half of the year of £20 million.

MEDIA UPDATES

Reach plc

Reach plc. the UK’s biggest regional publishing group is putting a fifth of its workforce on paid leave and reduce pay of all staff by a minimum 10pc as the pandemic trashes advertising revenues, Hold the Front Page reported on Monday.

Reach plc publishes more than 150 national and regional newspapers and websites with brands such as The Daily Mirror, Daily Express and Daily Star. All members of the company’s board, along with some members of the senior editorial and management teams, will be taking a pay cut of 20pc, while other staff will see pay reduced by 10pc.

The move follows similar announcements by fellow regional publishers JPIMedia, Newsquest, Archant and Iliffe Media.

Lonely Planet to scale down publishing

The BBC reports that guide book publisher Lonely Planet has announced plans to close most of its operations in London and Melbourne. It will reduce operations for the foreseeable future and suspend publishing the Lonely Planet Magazine.

Daily Mail

Daily Mail and General Trust — the parent company that publishes the Daily Mail, Metro and Mail Online — said on Monday that staff earning more than £40,000 would be asked to take pay cuts of up to 26 per cent. But Lord Rothermere, executive chairman of DMGT, also announced there would be a “unique” compensation scheme where employees whose salaries are cut will in return receive shares in the company equivalent to the same value each month.

Social With Media

Mark Palmer (MP), Travel Editor of the Mail; Laura Bartlett (LB), Editor in Chief of House of Coco (a website and quarterly print magazine aimed at luxury fashion, style and travel) and Katie McGonagle (KM), Features and Supplements Editor of Travel Weekly.

The Daily Mail

All the Mail staff were written to yesterday asking them to take a pay cut. The paper is losing money. Mark’s Escape section has no advertising coming in at the moment. And he has seen his 10 pages being cut to five this Saturday. He is looking to balance a combination of inspiring people for when the time is right to start travelling again and informing and advising them on their rights.

Each week MP is writing an editorial and aiming to advise people to be flexible with their bookings – and take a voucher for next year. He says he has a full ‘post bag’ from readers who want refunds, so he’s looking to steer a careful course.

Travel Weekly

Travel Weekly is only publishing digitally right now with its web chat content doubling in this newsy period. They are aiming to inspire and inform readers and publishing daily webcasts and a good deeds feed. looking for good candidates for profile Q&As – and they are not providing calls to action right now – they are just looking for interesting stories and ever green content. KM mentioned the piece she is looking to interview people in the industry overseas and how the lockdown is impacting them. She wants content that is a bit more ever green – not season based.

The industry has written off summer – as there is no consumer confidence. There maybe late booking for August/September. This is a different view from 2-3 weeks ago as people were pinning their hopes on summer.

It looks like there will be pent up demand for later in the year with winter sun destinations and resort based holidays.

KM thinks there is a strong case for a trend for all-inclusives as many customers can go and not engage with the wider community and meals are within a contained environment. So there is an argument that there is a good opportunity for them. City breaks are seen to be more challenging. As cities have been more impacted by the virus. Pent up demand will however, be dependent on the economy and personal finances and there is a feeling that people will defer travel to early 2021.

Even if there is greater demand at the end of the year, it will not make up for the loss of spring and summer.

Timing. Duty to readers to recommend places that are safe.

Cruise Q&A

This Saturday they are running a Q&A piece about the cruise industry and the innovative steps they are taking in providing good deals and flexibility. For example, there some cruise lines which are taking no deposits for next year. Readers love a cruise and the Mail relies on cruise advertising, but the sectorhas been hit hard especially given the recent history and the fact that there have been ill passengers stranded abroad. The Q&A will be tackling these issues head on.

Destinations & Trends

MP doesn’t feel that it is right to write gushing pieces about Europe, but he said strangely it was fine to be writing inspiration pieces about long-haul destinations, where there have been no news about the pandemic and he is also writing UK pieces too. All are badged with a passport style stamp ‘ for when it is OK to travel again’ – but he is finding that those pieces that also run online have comments about how irresponsible it is to be writing about travel.

He will not be writing about Italy (his favourite country) or Spain right now and both House of Coco and Travel Weekly agreed that this is the situation with them too. However, all acknowledged that this has been and will continue to be a fast moving situation, so as soon as the situation changes – ie that death numbers recede and/or travel restrictions are lifted.

MP: Once we are out of house arrest, he believes big villa or houses will be a trend. For intergenerational parties for extended families who haven’t seen each other for weeks or months.

Holiday cottages in Cornwall – could even be a trend across Europe.

Would consider southern Spain, middle to late October. Rent prices better than in peak summer.

It will also be an opportunity for hotels to take initiative to give good deal.s Too good an opportunity

Believes people will not want to go to crowded places.

Readers for Mail are older. Conscious that people want to go to places that are not crowded. Great outdoors. Beautiful countryside, wildlife, safaris.

UK and domestic tourism also big. Ireland will be the new Thailand. Staycation round-ups.

KM said that it is a complex picture, and she is collating content about a wide range of destinations as she is well-aware that border restrictions may well be relaxed in a piecemeal fashion. Long haul is also working at the moment, because it generally has a long booking lead in time – and people booking now will be booking for November/December. She will be running writing a feature about Australia.

KM – open about what they are promoting and they have a freer reign in some ways with regards to destinations as they are B2B and the situation can change so quickly. She sited China. TW supportive of all destinations.

KM said that it is a complex picture, and she is collating content about a wide range of destinations as she is well-aware that border restrictions may well be relaxed in a piecemeal fashion. Long haul is also working at the moment, because it generally has a long booking lead in time – and people booking now will be booking for November/December. She will be running writing a feature about Australia.

KM – open about what they are promoting and they have a freer reign in some ways with regards to destinations as they are B2B and the situation can change so quickly. She sited China. TW supportive of all destinations.

LOTUS, Unit K Taper Building, The Leather Market, 175 Long Lane, London, SE1 4GT, England

LB said that she is looking at any destinations but probably won’t be running pieces on destinations which have a high death count at the moment.

LB says that press trips will focus on staycations and solo travel will be big. People have got used to being alone. Some even like it.

Virtual Travel

All three said that enthusiasm for Armchair Travel is waning. “Virtual travel done to death”.

However, MP admitted that he would probably be looking to keep some kind of section about this on and all three said that they would be up for running news and content on virtual travel if it was fresh and had great content, but they certainly didn’t want to run stories about re-purposed marketing material as it could get lost in the noise.

LB said she was open about virtual travel, but ideas needed to be new and exciting.

Press trips

Obviously no press trips are happening at the moment. Also, there will be no firm commitment for press trips in the future either. However, they all want to know about trips being planned from September onwards. They are happy to have them on their radar and will confirm nearer the time.

New product

Similarly, they would all love to hear about new product due for launch at the end of this year and beginning of next. Mark says he is happy to put this in the Travel Notes section.

Pitches

LB said that she had initially taken pitches about isolated places, but that’s not good right now. It’s pretty much business as usual. Not offended by a release that doesn’t reference covid.

MP said that it is fine to pitch to freelancers. If it makes it through their filters, he will consider it.

He has written to freelancers recently to say that he hasn’t forgotten them but it is tough.

KM said that all pitches should acknowledge Covid-19. LB said that she didn’t need PRs to acknowledge the situation – as they were more about inspiration/aspiration. She said she didn’t know where budgets will be for freelancers – ie there isn’t any.

No prices are being sited before October 2020

House of Coco

LB is working on the June issue, which would normally be print, but this time will be online only. It will focus on wellness, mindfulness due to the fact that mental health issues are an even bigger topic than ever. They will be pushing 2021 travel

Content on social media is prioritised.

They are looking for takeovers such as with chefs doing live cooking demonstrations. They want pitches with video content that focuses on wellness.

She is running inspiration pieces and a ‘Taste of travel from home’.

World Travel Market

Simon Press from WTM made a guest appearance.

They are proud of their Excel partners and that it has been turned into a hospital.

WTM London is planned to take place at exactly the same venue. They are in constant communication with all authorities etc and a virtual hub will be up and running at the end of the month, with content, blogs and webinars.

TRENDS

Freelancers looking for inventive ideas

Richard Mellor, freelance travel journalist writing for Roxhill Media outlined how the travel media are looking for ever-more inventive pieces – for example, as people in lock-down are baking more, the editors are interested in baking breaks and babymoons, as there is likely to be a baby boom in nine months time. He is also looking for what other things are we learning and how might that impact travel?

Phocuswire: David Lansky

Destination specialist David Lansky conducted the first of a series of webcasts for Phocuswire about how the industry can emerge from the crisis with smart strategies, new roles for technology, bigger thinking and other useful tips for brands and destinations across the sector. His first webcast outlined how important it is to build consumer confidence. He says:

- It is important that destinations and brands prepare for the next pandemic.

- Consumers’ wishlist for travel still remains, but consumers will want destinations to have good medical credentials and for travel companies to prove that they have good access to them and that they have the ability to get passengers home if they are sick.

- Access to good insurance that covers pandemics is essential. - Antibody testing is essential for opening up economies and digital proof of tests could be useful for travel

For confidence, consumers will want to travel close to home

Travelmole

A number of industry experts predicted their own trends post-pandemic on Travelmole.

Tom Jenkins, CEO of ETOA said:

- Mass gathering will return. Theatres, cinemas and football matches will become crowded. Tourism will start again. - Consumers will still want to travel, to see the sights they have heard about, appreciate accommodation and enjoy the culture of a different location. - Under-visited domestic tourism locations will become more popular - Increased use of face masks. - There will be resistance to destinations and types of tourism that were associated with COVID19. - We will undoubtedly see some spectacularly eye catching prices to kick-start demand. - It will be a golden period for the fast-moving entrepreneur.

James Thornton, CEO Intrepid Group said:

- We predict isolated, 'clean' destinations will recover fast like stunning New Zealand's South Island Places; Norway and some of its neighbours are leading the way with their management of Covid-19.

-  2021 will be about getting outdoors and getting active so cycling and walking are likely to be popular.

- Lots of people looking to fulfill BIG bucket list travel experience - with Antarctica being at the top of that list - and that people will be looking for reasons to celebrate in 2021, including trips that are focused around local festivals such as the Rio Carnival trips we run.

- More awareness of where they go and how this impacts the environment and communities.

- Because of this, it's likely that travellers will consciously choose more under touristed destinations, such as Nicaragua or Greenland.

Chris Webber, head of marketplace at icelolly.com

- It is likely that this school summer term may be extended. October half term, Winter Sun and Easter 2021 will all be significant.

Lynn Narraway, managing director UK and Ireland, Holland America Line

We have been complimented on the unfailing service and care given to those on board during recent sailings and these are the things that help set the cruise industry apart and will continue to do so in the future.

Our clients have told us they are really looking forward to travelling far and wide later this year and in 2021; booking iconic experiences that they can look forward and plan for - such as Alaska's glaciers and wildlife; the fascinating cultures of Canada & New England; the Caribbean's warm winter sun and beaches.

Sojern Insights: Travel to increase in Q4 2020

The American travel marketing agency Sojern with its access to real-time traveller audiences and global travel demand said that in the week starting 6 April:

• According to our data, we do indeed start to see increases in travel within Europe, starting in Q4 2020.

• Searches in intra European travel appear to grow from as early as October. • Spain and Italy as destinations, which are experiencing the heaviest impacts of COVID-19, see increases in year-over-year bookings of 503% and 149%, respectively, by February 2021.

LATAM Now Showing COVID-19

Impact Sojern has also examined the Latin America destinations this week, as the region was isolated from the majority of infections in the first two months, and they are just beginning to feel the travel impact of COVID-19 now and the 2020 seasonality is changing.

 

BUSINESS SUPPORT

ETOA

ETOA has beefed up its Insight, Action and Resources section of its website and will be creating an information hub next week. In addition, it began a series of business support webinars for members, which this week covered legal, lobbying and accountancy issues. The site also has updates on all the current European government travel restrictions.

ABTA

ABTA has launched a new series of virtual webinars to provide practical guidance for the travel industry during the global Coronavirus crisis. The weekly 'business resilience' webinars will be delivered in collaboration with ABTA Partners and moderated by ABTA.

MMA

The MMA has launched the MMA Covid-19 Marketer Support Hub as a central resource for the marketing, media and tech industry to navigate the current global crisis (see press release here).

Skift

Online travel trade magazine Skift is running a series of Online Summits called Travel’s Path Forward. These virtual events will provide tactical ideas, analysis, and resilience to help the industry during these crisis times.

TTG

TTG is running a weekly a weekly programme of online events including a regular travel agent video diary, Agent Matters forums and Business Support Live sessions answering questions from the travel trade, the programme will also feature weekly Facebook Live events with tourist boards.

Travel Weekly

Travel Weekly has compiled a resource centre made up of advice and guidance from a number of our industry partners.